5 Ways To Finance Your New Car Purchase

Transparent piggybank with coins and red car

A car is a major and necessary purchase, especially when you live far away from where you work. If you’re planning to get one soon, make sure you get the best deals at the price you can afford. But what do you do when the funds you saved up are not enough? 

Here are some ideas that can land you the car you need sooner than you think:

1. Check Your Credit Score 

Taking out a loan? You must first see if you’ll qualify for it. A good credit score entitles you to better financing options. Check your credit score first at reputable sites such as Credit Karma. If it’s low, you need to increase your score back up again. 

According to Experian, you’ll need at least a score of 660 to qualify for a 6% and below interest rate auto loan. If your credit score is high, it would be easier to take out a loan from banks and credit unions. Banks will have a stricter documentation process, but credit unions might help as they’re non-profit and by-members-for-members only. They’ll offer better rates for vehicle finance and auto loans.  

2. Liquidate Your Assets 

A smart way to raise cash is to sell items that you or your family are not using anymore to gather enough funding. It can be jewelry and accessories that you’re not using anymore, electronics, branded shoes in good condition, vintage clothing, and more. You can choose to bring them to locations such as pawnshops and the Salvation Army. You can also find a platform online like eBay and thredUp where you can also sell your items.  

3. Explore Online Lending 

Good credit scores make it easy to secure a loan, but what if yours is less than ideal? You can still turn to a few alternatives like online lenders. There are many reputable lending websites on the Internet. You can fill out a form and get the rate based on your information and the amount you can get to secure the car in no time.  

4. Do Odd Jobs For People 

Selling your services may require hard work, but you’re earning honest-to-goodness cash. If you don’t have any skills, try babysitting ($28/hr), dog walking (15/hr) or pet sitting ($14/hr). 

You also have the choice to do yardwork, become a personal shopper, or a mystery shopper. Grocery shopping for the elderly or doing household cleaning for people you know is also a good way to start. You can sign up for online services on platforms like Freelancer, Fiverr, UpWork, and more for skill-based work. Try scouring for sites where you can do some servicing at the nearest locations.  

You may also want to start getting a job in the auto industry. You can start by washing cars or being a detailer, or work at the local garage. You’ll be killing two birds with one stone as you’re earning money, you’re also gaining skills working on cars.  

5. Use Home Equity  

If you’re paying for a home that has raised in value, you can use the equity to buy a car. Home equities have very few limits, even if some lenders restrict their borrowers to home-related purposes only. But you can use it for any legal purpose, even to buy the car that you want. It’s easy, and you only need to find the approval rate. 

You first need to have enough equity in your home. It means that the value of the house should be higher than what’s left of your mortgage. Lenders will run credit checks and other documentation, and after approval, you’ll get the money in two weeks.   

Conclusion

Don’t be discouraged if you think you don’t have enough saved up for a car. There are many more ways to help you secure the funding you need. All it takes is hard work, ingenuity, and a bit of creativity. Talk to your nearest dealer, then check out other dealerships to find the best quotes for a new or used car, so you’ll know what you’ll be working for.

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Will Hopstetter

Will is an automotive market enthusiast living in the United Kingdom. He holds a diverse background in automotive and enjoys utilizing that to produce insights into the inner workings of the industry.
Will Hopstetter
Will is an automotive market enthusiast living in the United Kingdom. He holds a diverse background in automotive and enjoys utilizing that to produce insights into the inner workings of the industry.